In this video I discuss the advantages offered to those with 401k, 403b retirements plans and IRA’s. Under the CARES Act the 10% withdrawal penalty is eliminated for COVID-19 related withdrawals. The qualified individuals under this requirement has expanded to include more people.

****SUBSCRIBE TO THIS CHANNEL FOR REGULAR FINANCIAL UPDATES****

SMART TAX PLANNING
IRS expands eligibility to take up to a $100,000 coronavirus-related withdrawal from IRA, 401(k)

IRS 800 919 9835 Economic Impact Payment Line. This is for questions regarding your payment for the CARES Act

Visit Warwick Shore Advisors

For the free financial planning cheat sheet send an email to investments@warwickshore.com

Visit the IRS portal

Social Security Administration website

The SSA updated their website yesterday with dates for when the direct deposits will be made as well as the physical checks that will be mailed out for the economic stimulus payments

Jobless claims total 1.5 million, worse than expected as economic pain persists

More people will be eligible to take a $100,000 coronavirus-related distribution from their retirement account.

The IRS released guidance on Friday which details new rules for individuals affected by Covid-19 to take a withdrawal from a 401(k) plan or an individual retirement account.

The CARES Act allows savers to take coronavirus-related distributions – emergency withdrawals – of up to $100,000 from their retirement plans and IRAs. And those who are under age 59½ can access the money without the usual 10% early withdrawal penalty.

These individuals can also spread the income tax from the withdrawal over three years. However, if they repay the money into the account within that time periods, they can avoid the tax.

Relief for taxpayers affected by COVID-19 who take distributions or loans from retirement plans

The CARES Act provides that qualified individuals may treat distributions up to $100,000 made from their eligible retirement plans (including IRAs) between January 1 and December 30, 2020. A coronavirus-related distribution is not subject to the 10% additional tax that otherwise generally applies to distributions made before an individual reaches age 59 ½. In addition, a coronavirus-related distribution can be included in income in equal installments over a three-year period, and an individual has three years to repay a coronavirus-related distribution to a plan or IRA and undo the tax consequences of the distribution.
In addition, the CARES Act provides that plans may implement certain relaxed rules for qualified individuals relating to plan loan amounts and repayment terms. In particular, plans may suspend loan repayments that are due from March 27 through December 31, 2020, and the dollar limit on loans made between March 27 and September 22, 2020, is raised from $50,000 to $100,000.

On Yesterday the IRS expanded the definition of who is qualified to take distributions or loans from a 401k without penalties. A qualified individual is anyone who –
• is diagnosed, or whose spouse or dependent is diagnosed, with the virus proved by a test approved by the Centers for Disease Control and Prevention (including a test authorized under the Federal Food, Drug, and Cosmetic Act); or

• experiences adverse financial consequences as a result of the individual, the individual’s spouse, or a member of the individual’s household (that is, someone who shares the individual’s principal residence):
o being quarantined, being furloughed or laid off, or having work hours reduced due to COVID-19;
o being unable to work due to lack of childcare due to COVID-19;
o closing or reducing hours of a business that they own or operate due to COVID-19;
o having pay or self-employment income reduced due to COVID-19; or
o having a job offer rescinded or start date for a job delayed due to COVID-19.

#IRAWithdrawals #CARESact

IRS Extends Rollover Deadline for Waived RMDs…(read more)

LEARN MORE ABOUT: Retirement Planning

REVEALED: Best Investment During Inflation

HOW TO INVEST IN GOLD: Gold IRA Investing

HOW TO INVEST IN SILVER: Silver IRA Investing